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Re: yahoo banner ads; worth it?
From Glen Caruso on 31 Dec '99
replying to yahoo banner ads; worth it? posted by judy

>I'm thinking of doing a banner with Yahoo!
>A one month test is $1500. with somethnig like 35,000 impressions.
>The Deadlock tutorial, a.k.a. my bible, seems to say it's not worth it. Anyone have an opinion or, better yet, experience/results, with Yahoo! banner advertising?

Judy -

I agree with Darryl (one of the people who responded to this message).
You have to do the numbers to see if it makes sense financially to
advertise.

First, it's critical to know how you plan to make money from your site?
Typically, it's either from the sale of products on your site OR it
could be from selling ad banners on your site OR it could be from
collecting email addresses for future marketing and sales efforts.

Now let's do the numbers:

35,000 advertising impressions on Yahoo! (through ad banners)
should receive a 1% click through (industry average). That means that
these 35,000 impressions will yield 525 people going to your site.
(35,000 x 1.5% = 525)

Of those people, about 2% (industry average) will actually buy/request
something from your site. This is called "conversion" (converting
from looking to buying/acting) That means that about 11 people will
be buying/requesting info (525 x 2% = 10.5)

Your cost per sale/inquiry then = $136.66 ($1,500/11 = $136.66)

NOW, how much will YOU make per sale or inquiry? And how does that
compare to the $136.66 average cost? If you make MORE than that per
sale, this schedule may be worth it. If you make less, maybe not.
(Keep in mind that more than one sale/inquiry may be generated from
this ad schedule. Consider the average lifetime value of each
customer acquired) Depending upon how much you make per sale/inquiry,
this schedule may be worth it. (I've read the average internet sale
is about $75)

If you want traffic to your site, these 525 impressions are now page
views to your site and worth 525 times whatever YOUR site's CPM is
(ex. 525 impressions x a $30 average CPM = $15.75) You spent $1,500
and got $15.75 back -- NOT WORTH IT!

If your collecting email addresses, how much can you expect to make
on every email address collected? In total? How does that compare
versus the $136.66 number?

I'd lay all this out on a spreadsheet and do different scenarios based
on different click through and conversion levels that you may get
(Your performance will not mirror the industry average of course.
Keywords can get a 10% click through -- or .01% click through)

I've been in web ad sales for the past 5 years selling for two major
web sites. Feel free to email me at
glencaruso@yahoo.com
if you have questions

Hope that helps!





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